Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : The Residential Real Estate Crash Index -- Ignore unavailable to you. Want to Upgrade?

To: orkrious who wrote (164579)	11/15/2008 1:00:47 PM
From: patron_anejo_por_favor	Read Replies (1) \| Respond to of 306849

Good piece, Fleck is always a good read. His solution is parallel to mine, and very "common-sensical". Obama needs someone around him to promote something like it. House prices WILL drop until they match the ability of owners and buyers to pay for them. Box/Jonny Dough's "Domino #1" strikes again! Savers and first time buyers continue to get screwed by Clowngress and the administration.

To: orkrious who wrote (164579)	11/15/2008 1:10:16 PM
From: ChanceIs	Read Replies (1) \| Respond to of 306849

RE: Fleck - Support Intelligent Solutions, Not House Prices I am with Fleck on this one. I have heard three arguments against supporting house prices: 1) moral hazard. 2) deadbeats will always be deadbeats and we ae merely kicking foreclosure down the road a year or so, 3)all that money in housing represents a gross misallocation of resources - eg keeping dry in grand style with the granite countertop vice building fuel officiant vehicles. The argument in favor of intervention is: Systemic financil system collapse. I have always questioned the governments constitutional authority to pursue the bailout course. That matters not. I am a single voice inthe wilderness. Given that it is authorized to do so, I question the governments ability to to affect home prices. Adam Smith's free hand will bring them back to 3X gross income in due course. If nothing else current and future buyers have had the s*&t scared out of them and will start asking reasonable questions like....what are reasonable historic house prices. Oh. 3X gross. Sounds good to me. I will wait for a deal. The fundamental problem is not house prices. It is bad mortgage loans. It just so happens that they are bad because they were made against overpriced real estate. What to do??? I think that the loss has to be spread where it belongs: 1) he who borrowed too much, 2) he who pilfered a little as an intermediary (originator/repackager/securitizer), and 3) he who was stupid enough to lend money/buy an MBS, etc. As a taxpayer, I was not in that chain. I did not benefit from it, and I sure as hell don't want to pay. OK. OK. I have made more than a few bucks shoring banks and home builders. I still don't want to pay. I have been doing good by taking away their capital before they could make more bad loans or build more empty houses.